West Virginia Offices of the Insurance Commissioner 2009 Annual ...

Senate Bill 537 - Relating to Workers’ Compensation. (Effective July 10, 2009)
In addition to numerous technical changes, the bill makes the following substantive
amendments to the Workers’ Compensation statutes.
§23-2-1d. Prime Contractors and Subcontractors Liability - The amendment of this section
(which had sunsetted) now holds prime contractors liable for providing workers’ compensation
benefits to an uninsured subcontractor’s employees if that prime contractor had failed to require the
subcontractor to produce a certificate of coverage.
§23-2A-1. Subrogation; limitations - This amendment clarifies some confusion about
subrogation rights arising out of injured workers’ claims against third-party tortfeasors.
--For any claim arising on or after January 1, 2006, a private carrier or self-insured employer is
allowed statutory subrogation for both indemnity and medical benefits paid.
--For any claim arising before January 1, 2006, the Commissioner or BrickStreet is allowed
statutory subrogation for only medical benefits paid through the date of recovery and (resurrecting the
pre-2003 rule), with respect to any recovery arising out of a cause of action accruing prior to July 1,
2003, the Insurance Commissioner’s or self-insured employer’s recovery may not exceed 50% of the
amount received by the injured worker.
--A new subsection was added giving the Commissioner the right to statutory subrogation for
indemnity and medical benefits paid from the Uninsured Employers’ Fund (“UEF”) regardless of the
date on which the cause of action arose.
--The amendments also allow the Insurance Commissioner to negotiate the amount to accept as
subrogation.
§23-2C-8. Workers’ Compensation Uninsured Employers’ Fund - The change to this section
confers jurisdiction on the Office of Judges (“OOJ”) to hear protests on initial decisions to accept or
reject a claim into the UEF rather than the bifurcated process in which the Commissioner determined
whether the claim belonged in the UEF and OOJ determined, often contemporaneously, other claimsrelated
issues.
§23-2C-15. Mandatory coverage - This changes the date -- from June 30, 2012 to June 30,
2010 -- on which state and local governmental bodies are able to purchase workers’ compensation
insurance from insurers other than BrickStreet. It also prohibits BrickStreet from cancelling or
refusing to renew a policy of a state or local governmental body prior to July 1, 2011, except for
nonpayment of premium or refusal to comply with a premium audit.
§23-2C-17. Administration of a competitive system - The amendment to subsection (c)
clarifies that private carriers or self-insured employers may only enter into contracts with third party
administrators that are licensed by OIC.
§23-2C-21. Limitation of liability of insurer or third-party administrator; administrative fines
are exclusive remedies - This clarifies that the Commissioner has the authority to use all of her
regulatory authority in Chapters 23 and 33 with respect to administrative fines and remedies against
workers’ compensation insurers. A change was also made to permit OOJ to award attorney’s fees for
an unreasonable denial of any TTD benefits; the prior law had been limited to denials of initial TTD
awards only.
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